Official Costco information detailing the new return policy

Information on Costco's Concierge service
Costco reduces its previous unlimited return window down to 90-days, while Canadian stores see no change

Costco, known for its warehouse style stores and wholesale prices, is making a sweeping policy change to its stores across the U.S. The retailer’s much touted time-unlimited return policy is being revised to exclude electronics and computers.

Under the new policy, televisions, computers, cameras, camcorders, MP3 players and cell phones will now be given a 90-day return window. Previously, notebook and desktop computers were under a six-month return policy, while the rest of the electronics section had an unlimited return window like the rest of Costco’s products.

A memo sent by Costco’s corporate heads informs and instructs warehouse managers on the policy changes and how best to convey them to the customers. “Excellent member service is always a Costco’s first priority, so it is critical that the return policy change is communicated to the member in a positive fashion,” read the memo.

The note detailed rollout schedule for the new policy, which began on Feb. 26 in California, then moving to the remaining west coast stores on March 12. Texas and the mid-west stores will change on March 19. The northeast stores change on March 26, with the blanket closing last on southeast stores on April 2. The memo notes: “The 90-day refund policy is effective for purchases made on or after the regional rollout date. All previous purchases are NOT subject to the new 90-day policy.”

Costco’s time-unlimited returns became the topic of much scrutiny after a reports of customers abusing the policy by bringing back obsolete electronics and televisions—that were still in working condition—for refunds or in exchange for new models.

The new policy the retailer aims to curb opportunities for such abuse, while trying to uphold Costco’s reputation for having the best after-sale satisfaction program. As a result of the new 90-day limit, Costco is extending the manufacturer’s warranty on televisions and computers to two years from the date of purchase, up from one year from the old policy. Costco is also pushing its “Concierge Technical Support” program, which offers free support for all its electronics products except for cell phones.

“Our view is, even with these changes, we still have the best return policy in the retail industry,” Costco CFO Richard Galanti, said in an interview with the Wall Street Journal, adding that Costco does not impose a restocking charge on returned items.

At this time, it appears that the new 90-day policy change is applicable only to Costco stores located in the U.S. Costco’s Canadian locations report no change in policy, also represented by the state of status quo the Web site.

“We haven’t gotten any memo about changes to the return policy,” said a warehouse manager at a Costco in western Canada, who confirmed that there have been a small number of cases of abuse in the policy. “We don’t like seeing people take advantage of our store, so refunds on things like TVs are sometimes up to the manager’s discretion, especially if they are non-defective returns more than a year after purchase.”

U.S. Costco locations will update its signage and distribute the updated information to members through pamphlets detailing support on electronics. Costco’s Web site already has a document detailing the new policy (PDF).

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